Nearly 50% of all purchases in this world happen by Word Of Mouth. What % of your business comes by Word Of Mouth ? 50 % ? Then you are doing a great job. But, what if it is not ? Then, don’t wait !
Click here to sign-up for a FREE Trial of Loyaltics Word Of Mouth Marketing Software !.
If you are a hotelier, then the chances are high that you rely on Online Travel Agents (OTAs), Tour operators and Travel Agents to fill your rooms and then part huge booking commissions with them. Now, look at the below diagram for a fresh approach to finding sales leads and growing your business.
Word of Mouth Marketing for Hotels
On the left is the current way of ‘lead generation’ by engaging 3rd parties to fill your hotel rooms. And, on the right is the ‘Word of Mouth’ way of ‘lead generation’.
While there are pros and cons in engaging 3rd parties, its the huge booking commissions and poor customer engagement which has been bothering the hoteliers for a long time. So, hoteliers have wanted to explore ‘direct channels’ and some have looked at ‘Social Media’ as one possible mean, but it comes with its own operational challenges, particularly for Small Independent and Boutique Hotels & Resorts who could not compete with the big boys due to lack of resources. There need to be a holistic integrated and automated approach, not just a one-off marketing trick.
The new approach, as depicted above, starts with measuring ‘Guest Experience’. Barring certain economic / budget hotels, guests check-in to a Hotel or Resort for ‘Experience’. So, you want to offer ‘great customer experience’ that will be etched in the minds of the guests forever. And, you want to ‘measure’ it ! If you can’t measure, you don’t know where you stand currently, and you can’t improve too!. We’ll reserve a future article for how to measure your ‘Guest Experience’.
Now, when you measure your guest experience, you’ll be able to find your “Hotel Advocates” OR “Brand Advocates”. These are your customers who have had fantastic experience at your property and are very happy to share the positive experience with friends, family, relatives, business and social contacts.
Who is a “Brand Advocate” and what does he do for your hotel ?
1. Loyal to the Hotel, obviously.
2. Provide ‘repeat bookings’, recommend (Word of Mouth) to family, friends, relatives, business and social contacts.
3. Increase their ‘Wallet Share’ (ie., Purchase more from you…example: at the Hotel Bar, Restaurant etc).
4. Not sensitive to room price changes or temporary drop in service quality.
5. Helps your Hotel to innovate and differentiate from the competition.
If you don’t have any Brand Advocate, then you risk getting ‘commoditized’.
If you go back to point (2), you can see “Brand Advocates” can get very vocal about your Brand, your products & services. With the power of social media, a Brand Advocate’s voice gets amplified several times, and heard by 10s of 100s of your prospects. That’s how your Brand Advocates transform themselves into a Marketing Machine for you and generate Positive Word of Mouth in their most active social channels. All you got to do is provide the necessary tools to help generate and amplify their Positive Word of Mouth.
Now, why is “Word of Mouth” the best form of marketing ?
1. Up to 50% of all purchases happen by Word of Mouth – McKinsey Report
2. 90% of consumers ( travelers including) trust Word of Mouth than Advertising – Zocalo Group
3. Each post by a Brand Advocate on Social Media reaches on an average 150 other people – Forrester Report
4. Creates quality leads, drive sales, lower customer acquisition cost, create customer engagement and Brand Awareness.
And, this is what some top business leaders have to say:
“Word of mouth is very powerful” – Jeff Bezos, CEO, Amazon.com
“The #1 Driver of our growth has been Word of Mouth” – Tony Hsieh, CEO, Zappos.com
And, why does ‘Word of Mouth’ convert better ?:
Word of Mouth Vs Traditional Advertising
So, its clear “Word of Mouth” is a proven mechanism to grow any business. You, as a hotelier, need to provide the necessary “Word of Mouth” tools to your guests to grow your business too. In the upcoming articles, we’ll delve deep into each of the steps involved in “Word of Mouth Marketing” and its associated tangible benefits it can produce for your Hotel. You can also sign-up for a demo of our “Word of Mouth Marketing platform for Hotels & Resorts”.
As always, would love to hear your views !
“I’m dying to go to Singapore. That’s my next goal in life — to build a hotel in Singapore,” Steve Wynn said.
Who is Steve Wynn, btw ?
Steve is a billionaire American Casino / Real-Estate developer who owns several resorts and casinos in Las Vegas and Macau.
But, why come to Singapore in 2017 ?
Steve didn’t say that, it is my interpretation based on the following facts.
1). Singapore currently has 2 major casino resorts: Resorts World at the famous Sentosa Island, and Marina Bay Sands which is partly owned by another Las Vegas based casino builder Las Vegas Sands.
2). Singapore government has given exclusive rights to this region to these 2 casino resorts until 2017.
Why come to Singapore ?
1). Singapore legalized gambling way back in 2005 to challenge Macau and attract more visitors.
2). No# of Visitors to Singapore is growing fast and is expected to reach 17 million by 2015.
3). And, we love playing Mahjong. For those who don’t know what it is, it is an ancient Chinese game these days played as a gambling game.
4). The two Integrated resorts have created a number of jobs reducing Singapore’s unemployment rate to mere 2.1 %.
5). Singapore is set to overtake Las Vegas and become the 2nd largest gaming center in the world, after Macau.
So, if Steve is reading this article, here are some key financials from Q1, 2011, that will be of some interest to you.
| Metric | Marina Bay Sands | Resorts World Sentosa |
| Market Share | 44% | 56% |
| Net Revenue | 585 Million USD | 739 Million USD |
| EBITDA Margin | 49% | 59% |
Lovely, isn’t ?
Amidst all these impressive data, what are the social consequences of a Casino ? We’ll reserve that for a separate article in the future.
Groupon is launching a travel deal service with Expedia. Groupon’s CEO Andrew Mason said that the new service will allow travelers to book hotel rooms and airfare from Expedia at a steep discount.
Only time will tell us what the deal is all about, and how Hotels and Travelers fit into the mix. While this is a good news for leisure travelers that are not attached to any particular brand and are always looking for great deals, it may not be such a good news for Hotels. But its clear its all about ‘steep discounts’, which obviously is a matter of concern for Hotels than Travelers.
Typically, any business will want to create loyal customers who will make repeat purchases than one-off ‘deal-looking’ customers. Hotels are no different. Hotels want to create loyal customers and brand advocates, who will make repeat bookings, and refer the Hotel to their family, friends, relatives and colleagues. It’s proven that recommendation by a loyal customer can produce better results than display ads.
So, is it high-time that Hotels start to look at ‘direct channels’ a little bit more seriously ? Focus on moving up the value chain rather than competing on price points ? Establish direct customer relationships, listen and innovate with your brand advocates ?
Hoteliers, I would love to hear your thoughts on this recent development !
Update to the post:
Within three days of the partnership, Expedia sold 15,000 travel deals. Recently, the management has suggested that it is no longer confident of the long-term value of sales made through Groupon. They are questioning the loyalty of customers acquired through Groupon deals.
We’ve been covering the Hospitality Industry in the Indian sub-continent for quite a while. And, there is more interesting news awaiting for those following India closely.
Hilton’s CEO, Mr. Christopher Nassetta has said he intends to triple Hilton’s presence in India over the next two years. Hilton has plans to increase its property count from 4 to 14 during this period. There are also plans to launch 50 other hotels under its various brand names.
All these expansions are attributed to significant increase in travel in India both domestically and Internationally.
With other Hotel groups like Intercontinental and Marriott also having ambitious expansion plans in India, Hilton is expected to have some tough competition. Overall, it is a very healthy sign for the Indian economy and the hospitality industry and its professionals in general.
As we’ve been repeatedly emphasizing, it is the mid-market hotel segment which is going to get hot particularly in the Tier-2 cities of India.
So, hospitality pros, start learning Hindi Today !
We’ve been covering a lot thats happening in the Hospitality sector of the Indian peninsula.
A recent HVS Executive Search report says, F&B Director salaries have jumped by 43% in the last two years.
F&B Directors in the luxury category make about 45,000 USD per year, which is only slightly lesser than Sales & Marketing Directors.
In general, the Services sector is huge in India, with IT Industry growing at an astounding rate and leading the pack. Salaries have been increasing at the rate of 15% over the past decade. With the entry of several large chains in the Indian Hospitality sector, the trend that catapulted the Indian IT Industry to the top will hold good for Hospitality sector too. So, salaries are only expected to grow in the upcoming years.
We already covered a bit about the Indian Hospitality Industry in earlier blog posts such as Indian Aviation Industry set to take off ! Hoteliers watch out ! and Hyatt expanding in India – Plenty of Hospitality Jobs to be created ! .
More good news is awaiting for those monitoring the hospitality sector in the Indian peninsula.
Aerens Gold Souk Group, a four decade old, diversified conglomerate with interest in retail, entertainment and real estate is planning to enter the hospitality sector with a strategic alliance with Wyndham Hotel Group for as many as 10 hotel projects.
The Group will build deluxe hotels in Tier-II cities such as Kochi, Ludhiana and Hisar. We’ve covered extensively in the early blog posts of the growth potential of Tier-II cities in India. Our belief is reinforced by this recent strategic alliance.
The new hotels are expected to have 100 to 120 rooms and will be opened sometimes in 2015.
Not sure how many of you know that there is Cricket World cup going on in the Indian sub continent. Cricket is huge, cricketers are gods in the world’s second most populous nation. It’s like 4x of US population watching this sport. Not to forget several million fans outside of the sub continent.
The stage is set for a fitting finale on 2nd April 2011, at Mumbai, India between host India and Srilanka.
In this blog post, we’ll look at what the Hotels, not just in Indian sub continent, but elsewhere too, did to capture a piece of this madness, and what can be done for the Finals.
Many claim that the match of the tournament was the mouth-watering semi-final clash between arch rivals India and Pakistan in a day-night encounter at Mohali, North West of India happened on 30th March 2011. India went on to win the match by 29 runs. For those interested in the match stats, go here.
The stage is set for the finals now, at Mumbai, India with Sachin Tendulkar, the God of Cricket, playing in his home ground in his final world cup. He has never won a world cup, btw.
So, how was “life” in the Indian sub-continent just for one day (on 30th March)?
- Office timings changed to let employees enjoy the match.
- Movie theaters screened the match instead of movies.
- Companies allowed employees to bring their families to work to enjoy the match.
- Many schools, colleges, companies declared half-day off.
- Both Indian and Pakistani Prime Ministers enjoyed the match live.
And, How did Hotels, Cafes, Bars prepare for this showpiece?
- Unlimited alcohol, soft drinks, starters, giant screens (obviously)
- Cheer leaders, tattoo artistes, Vuvuzelas
- Indian traditional musical instruments – dhol, drum etc
- Lucky prizes
- Free drinks to women
- Waiters dressed in cricketing attire
- Special dishes made in the name of cricketers and their style of playing – Budget Pathan, Sizzling Sreesantha, Gayle’s punch and so on !
It is not about dining and drinking, but about the ‘whole experience’.
So, it was fun !.
BUT, I was little surprised that Hoteliers here in Singapore didn’t do much about it !.
First some facts :
1). Indians makeup a quarter of the 1.7 million foreigners in Singapore. Add up Pakistanis, the number only looks astonishingly huge.
2). Every Indian aged 2 to 100 loves cricket.
3). Celebration, along with family and friends, is part of the Indian culture.
4). Every Company with an IT department should have at least one staff from this sub continent.
Its clear its a lucrative market segment.
So, here are some tips to attract this population !
1). Talk to someone in your network (friends , family, staffs, social network etc) who knows cricket and what this sport means to people from the sub continent.
2). Call an IT Head of a company, and offer a group package for his entire team, given the possibility that many of his staffs would be from the Indian sub continent. They may have some group outing budget left to use.
3). Ask for a referral from your network. Get him/her to bring his family and friends to enjoy the match with discount.
4). Upsell (alcohol, soft drinks, food, one night stay, spa, foot massage – plenty of options to work with depending upon your offerings).
5). Find your best customers who have good social media presence. Give them a discount code and request it to be shared with his friends on Social Media.
6). Plenty of Groupon like sites have popped up recently. So, post a group deal.
6). Cricket is a complex game. So, learn a thing or two about the rules and the top stars of the game, so that you can strike some interesting conversations with your customers, WOW them and maybe even retain them forever.
Let your creativity begin to flow !
With the finals to be played between India and Sri Lanka, and with Singapore having a considerable population of these two nationals, what is the Hospitality industry in Singapore doing to appeal to them?
A smart hotelier in Singapore have already won my (and my friends’) business for the Semi-finals and finals !
Just on the heels of our blog post about Indian Aviation Industry set to take off ! Hoteliers watch out !, Hyatt announced 9 new Hotels in various cities across India.
There are currently 38 Hyatt Hotels under development in India and other large chains should also make announcements about their India strategy soon.
As I pointed out in the above blog post, Tier II cities is where greater demand is going to come from, in the future. Rightly so, Hyatt is developing its properties in cities such as Surat, Jaipur, Ghaziabad, Lucknow etc.
These new developments also mean, about 10,000 new Hospitality jobs will be created, and particularly a huge demand at Senior and Middle management levels.
I know hoteliers are always globe-trotters. With India and China set to lead world economic developments in this decade, and if you have any aspirations to pursue your hospitality career in these two powerful economies, watch out for future developments !.
And, start learning Hindi !
All of us are aware that Customer Service can make or break your business. It can drive Customers away from you or bring them back repeatedly, even better, bring their friends, colleagues and family, and be your lifelong customer.
What is Customer Satisfaction ?
Offering just what the customer wants !
What is Customer Loyalty ?
Offering more than what the customer wants and ‘WOW’ him so much that he will sing your praise to his friends, family and colleagues. And, you will have his business forever.
Now, depending upon the size and scale of a Hotel operation, Customer Services Executives are typically trained anywhere from good to great in handling customer relationships. In my experience, many of the Hotels have hired people with the right attitude such as a pleasant disposition, service mindset, being social and other ingredients that are required to handle a customer. All that helps in satisfying the customer, but ‘WOWing’ ?
You need to WOW your customers, if you have to build Customer Loyalty. You need to always think of ways to elevate your Customer Service to the next level. And, you cannot WOW your customers just by training yourself more and more in Customer Relationship Management. Because, WOWing is context specific, where a Customer and Customer Service Executive interact in a given situation. It is hard to simulate that kind of setup in a training room. So, the focus should shift from Training to fixing the mindset. Even better, hire staffs with that mindset.
So, what is that mindset or skill or whatever ?
Thinking on your feet !
Constantly thinking on your feet to WOW any customer in their vicinity, in a given context.
I haven’t seen much of such impromptu actions from the Customer Service Executives, rather just offering the standard set of services. Probably they are just too overloaded or too absorbed in their work.
I had a friend who can crack jokes at will at any given circumstance. He had that natural ability, not built by training. It gave him enormous leverage when socializing with people, and all of them are naturally gravitated towards him.
Just like Leadership is part charisma and part training; sales is part art and part training; Customer Service is part attitude and part training.
While the subject of “Thinking on your feet” is outside the scope of this article, I would like to highlight a couple of attributes that can help you to think on your feet.
1. Listening skills – A lot of time we are just preparing ourselves to respond to the customer than actively listening to what the customer has to say. Develop active listening, you can get some clue on how to WOW the customer.
2. Be a generalist as opposed to specialist – I am not suggesting that you don’t become a specialist in Customer Service, however be interested in a variety of subjects. You never know what kind of customer you will be handling next. He could be from another country, language, religion, culture, race, industry and so on. Being a generalist can help to connect the dots and strike an interesting conversation and even WOW the customer.
Remember, all it takes is just one impromptu action from a creative Service staff to convert someone to be a life-time Customer !